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A drug company is considering investing $100 million today to bring a weight loss pill to the market. At the end of one year, there

A drug company is considering investing $100 million today to bring a weight loss pill to the market. At the end of one year, there is a 0.50 probability that the pill will forever sell at a high price and generate $37 million dollars per year of profit forever, but there is a 0.50 probability that the pill will forever sell at a low price and generate $1 million per year of profit forever. Assume that the interest rate is 10%. Suppose the firm decides to wait one year to determine whether the pill will sell at a high or low price. The firm will not invest if it learns that the pill will sell at a low price. What is the net present value of waiting one year to make the investment?
$201.22 million
$64.5 million
$107.44 million
$88 million

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